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New analysis from TD Cowen suggests that landmark U.S. legislation designed to establish a clear regulatory framework for the cryptocurrency market may be significantly delayed. The bill, which aims to provide clarity on agency oversight and asset classification, could see its passage pushed to 2027, with full implementation not expected until 2029.
Key Takeaways
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U.S. crypto market structure bill passage potentially delayed to 2027.
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Implementation of the bill could be pushed to 2029
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Political dynamics and conflict-of-interest provisions are major hurdles.
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Democrats may leverage the delay for strategic advantage.
Political Roadblocks Ahead
According to TD Cowen's Washington Research Group, led by managing director Jaret Seiberg, political dynamics within Congress make a swift passage unlikely. Democrats, in particular, may have little incentive to expedite the bill before the 2026 midterm elections, especially if they anticipate regaining control of the House of Representatives. While a deal could be struck quickly given ongoing technical work, Seiberg notes that "time favors enactment as the problems disappear if the bill passes in 2027 and takes effect in 2029." This scenario, however, would mean the presidential election could influence the final rules, and certain provisions might not apply to former President Donald Trump.
Conflict-of-Interest Provisions Spark Debate
A significant point of contention is expected to be conflict-of-interest language. Democrats are likely to advocate for provisions that would prevent senior government officials and their families, including Donald Trump, from owning or operating crypto businesses. Seiberg suggests such language would be a "nonstarter" for Trump unless its effective date is postponed by several years. A potential compromise could involve delaying the entire bill's implementation by three years, pushing it past the next presidential inauguration, which would mean it would never apply to Trump. However, Democrats might only accept this if the rest of the bill is also delayed.
Legislative Hurdles and Industry Impact
The crypto market structure legislation is viewed as the next crucial regulatory step following the stablecoin "GENIUS Act." However, passing it in the Senate requires 60 votes, necessitating bipartisan support. The current political climate and the need for Democratic votes could give them leverage to delay the bill until after the midterms. A later enactment date would also allow Democratic regulators to shape the final rules if a Democrat wins the presidency. The crypto industry, conversely, would prefer the law to take effect under a Republican administration and is largely indifferent to conflict-of-interest provisions, creating a mismatch that complicates the legislative process. Policy experts have estimated a 50%-60% chance of the bill becoming law in 2026, though TD Cowen's analysis suggests a later timeline.
Sources
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Crypto market structure bill could be delayed to 2027, with implementation in 2029, TD Cowen says, The Block.
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Crypto market structure bill could be delayed to 2027, with implementation in 2029, TD Cowen says, LinkedIn.
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U.S. Cryptocurrency Market Structure Bill May Be Delayed Until 2027, Expected to Be Enacted by 2029, KuCoin.
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